A hospice's exposure under the civil False Claims Act often comes down to one evidentiary problem: the government's witness reviewed medical records years later and reached a different conclusion than the certifying physician did at the time. The Eleventh Circuit confronted that scenario in United States v. AseraCare, Inc., 938 F.3d 1278 (11th Cir. 2019), after the government's witness reviewed a sample of 223 patient files and found 123 patients he considered ineligible for hospice care. DOJ closed fiscal year 2025 with $6.8 billion in False Claims Act settlements and judgments, the highest total in the statute's history, with $5.7 billion from healthcare matters, so eligibility-based hospice cases remain a live theory. For a hospice compliance officer, AseraCare answers the question that decides these cases: what kind of proof turns a certification into a false claim.
Eligibility Certifications and the Length-of-Stay Problem
Medicare pays the hospice benefit on an attending physician's and a hospice medical director's written certification, required under 42 U.S.C. 1395f(7)(A), that a patient has, in the physician's or medical director's clinical judgment, a life expectancy of six months or less, the statutory definition of terminally ill under 42 U.S.C. 1395x(dd)(3)(A). That certification is renewed every 60 or 90 days, and the AseraCare court noted there is no statutory limit on how many periods a patient may be recertified, so a long length of stay is not, on its own, evidence that the original prognosis was wrong. AseraCare began the way many hospice cases do: three former employees filed a sealed qui tam suit alleging unsubstantiated claims, and the government later intervened and took over the case.
The Eleventh Circuit's Objective Falsehood Standard
The Eleventh Circuit held that a hospice certification is not false under the FCA if the underlying clinical judgment reflects no objective falsehood, and it then set out what that showing requires: proof that the certifying physician never reviewed the patient's records or otherwise learned the patient's condition before certifying, proof that the physician did not actually believe the patient was terminally ill, or witness testimony that no reasonable physician could have reached the same conclusion on the same records. A second physician reading the same chart and reaching a different number does not meet any of the three.
A properly formed and sincerely held clinical judgment is not untrue even if a different physician later contends that the judgment is wrong.
What AseraCare's Own Record Shows About Retrospective Disagreement
The trial record in AseraCare shows why the court drew that line. The government's own witness, Dr. Solomon Liao, changed his opinion on certain patients during the litigation, concluding that some patients he had earlier found ineligible were in fact terminally ill after all, and he testified that both sets of contradictory opinions remained accurate to a reasonable degree of certainty. The Eleventh Circuit held that this kind of after-the-fact disagreement, without more, does not establish an objective falsehood. The court affirmed the district court's order for a new trial on that ground and sent the summary judgment ruling back for the trial court to weigh the entire evidentiary record, not just the trial testimony.
The Separate Knowledge Requirement
Falsity is only one of the elements the government must prove against a provider in any FCA case; the government also has to prove scienter, materiality, and that the statement caused a government payment. Under 31 U.S.C. 3729(b)(1), knowing means actual knowledge, deliberate ignorance, or reckless disregard of a claim's truth or falsity, and ordinary negligence does not satisfy that standard, including where the dispute is between two physicians reading the same chart. The FCA knowledge standard after SuperValu works out what counts as reckless disregard, a separate question from the falsity standard AseraCare resolves.
Why Early Legal Counsel Is Critical
It is critical that hospice and home health providers promptly retain experienced healthcare defense counsel upon receiving a civil investigative demand, a government intervention notice, or any other sign that an auditor is building an eligibility-based case. Early legal intervention can shape which medical records and certifying-physician testimony the government relies on, preserve the AseraCare objective-falsehood defense before a complaint is even filed, and avoid admissions that narrow a provider's options later. A resolved case can still carry consequences beyond the judgment itself, including a corporate integrity agreement or an OIG exclusion, and the government's look-back period, covered in the FCA statute of limitations and the tolling fight, often reaches further than providers expect. Delaying representation can significantly affect the outcome of a matter.
How Health Law Alliance Can Help
Health Law Alliance's hospice and home health audit defense attorneys work within the firm's broader False Claims Act defense practice, building the eligibility record before the government does, from certifying-physician documentation to the objective-falsehood standard AseraCare requires the government to meet. Health Law Alliance's attorneys have overseen 2,000+ audits and handled 5,000+ matters, with 25+ years of experience. If your hospice or home health agency is facing an eligibility-based audit or a qui tam suit, contact Health Law Alliance for a free, confidential consultation.
